Exposure to External Country Specific Shocks and Income Volatility / World Trade Organization.

Format:

Book

Government document

Author/Creator:

World Trade Organization.

Series:

WTO Working Papers, 25189808 ; no.2009/04.

WTO Working Papers, 25189808 ; no.2009/04

Language:

English

Subjects (All):

Economic research and trade policy analysis.

Local Subjects:

Economic research and trade policy analysis.

Physical Description:

1 online resource (23 pages).

Place of Publication:

Geneva : World Trade Organization, 2009.

System Details:

text file

Summary:

Using a dataset of 138 countries over a period from 1966 to 2004, this paper analyses the relevance of country specific shocks for income volatility in open economies. We show that exposure to country specific shocks has a positive and significant impact on GDP volatility. In particular, we find that the degree to which the cycles of different trading partners are correlated is more important in explaining exporters' GDP volatility than the volatility of demand in individual export market. We also show that geographical diversification is a significant determinant of countries' exposure to country specific shocks. Keywords: income volatility, geographical export diversification, external shocks.

Access Restriction:

Restricted for use by site license.